MillerKnoll Inc (MLKN) 2024 Q1 法說會逐字稿

Good evening, and welcome to MillerKnoll's Quarterly Earnings Conference Call. As a reminder, this call is being recorded. I would now like to introduce your host for today's conference, Vice President of Investor Relations, Carola Mengolini.

晚上好，歡迎參加 MillerKnoll 的季度財報電話會議。提醒一下，此通話正在錄音。現在我想介紹一下今天會議的主持人，投資者關係副總裁卡羅拉·門戈里尼 (Carola Mingolini)。

Good evening, and welcome to MillerKnoll's First Quarter Fiscal 2024 Conference Call. I am joined by Andi Owen, Chief Executive Officer; and Jeff Stutz, Chief Financial Officer. Also available during the Q&A session are John Michael, President of Americas Contract; and Debbie Propst, President of Global Retail. Before I turn the call over to Andi, please remember our safe harbor regarding forward-looking information.

晚上好，歡迎參加 MillerKnoll 的 2024 財年第一季電話會議。執行長安迪歐文 (Andi Owen) 也出席了會議；和財務長傑夫·斯圖茨(Jeff Stutz)。出席問答環節的還有 Americas Contract 總裁 John Michael；和全球零售總裁 Debbie Propst。在我將電話轉給安迪之前，請記住我們有關前瞻性資訊的安全港。

During the call, management may discuss information that is forward-looking and involves known and unknown risks, uncertainties and other factors, which may cause the actual results to be different than those expressed or implied. Please evaluate the forward-looking information in the context of these factors, which are detailed in today's press release. The forward-looking statements are as of today, and we assume no obligation to update or supplement these statements.

在電話會議期間，管理層可能會討論前瞻性訊息，並涉及已知和未知的風險、不確定性和其他因素，這可能導致實際結果與明示或暗示的結果不同。請在這些因素的背景下評估前瞻性信息，這些因素在今天的新聞稿中進行了詳細介紹。前瞻性陳述截至今天，我們不承擔更新或補充這些陳述的義務。

We may also refer to certain non-GAAP financial metrics, which are reconciled and described in our press release posted on our Investor Relations website at millerknoll.com. With that, I will turn the call over to Andi. Andi?

我們也可能會參考某些非 GAAP 財務指標，這些指標已在我們的投資者關係網站 millerknoll.com 上發布的新聞稿中進行了核對和描述。這樣，我就把電話轉給安迪。和我？

Thanks, Carola. Good evening, everyone, and thank you for joining our call. I'm very excited to share that our team delivered a strong first quarter, as evidenced by our top line results and margin expansion. Across our enterprise, we have set ourselves up to seize opportunity as market conditions improve, and we believe we are at an inflection point.

謝謝，卡羅拉。大家晚上好，感謝您加入我們的通話。我非常高興地告訴大家，我們的團隊在第一季取得了強勁的業績，我們的營收業績和利潤率擴張就證明了這一點。在我們的整個企業中，隨著市場狀況的改善，我們已經做好了抓住機會的準備，我們相信我們正處於一個拐點。

Now regarding our continuing strategy, I'd like to highlight some of the efforts we're making to become more resilient and future-proof our business, including diversifying our business both in North America and globally, streamlining our global operations, moving production and capacity efficiently and investing in e-commerce. We believe that the work we're doing is paying off with much to look forward to on the horizon.

現在，關於我們的持續策略，我想強調我們為使我們的業務更具彈性和麵向未來所做的一些努力，包括使我們在北美和全球的業務多元化、簡化我們的全球運營、轉移生產和有效提高產能並投資電子商務。我們相信，我們正在做的工作正在取得回報，並且值得期待。

At the same time, we remain pragmatic about the next few months. We're still in the early period of recovery, and our business segments reflect a varied economic conditions around the globe. Right now, we have cause for both enthusiasm and vigilance. We've seen companies begin to take the leap back into physical space and announced return to office policies. Office leasing in the U.S. began to rebound in the second quarter of 2023, and we're seeing this amongst our clients as companies continue to announce return to office policies.

同時，我們對未來幾個月保持務實態度。我們仍處於復甦的早期階段，我們的業務部門反映了全球不同的經濟狀況。現在，我們有理由既熱情又警惕。我們已經看到公司開始重返物理空間並宣布了重返辦公室政策。美國的辦公室租賃量在 2023 年第二季開始反彈，隨著公司繼續宣布重返辦公室政策，我們在客戶中看到了這種情況。

Moreover, the American Institute of Architects' Billing Index or ABI, has been flat for the last 6 months, suggesting a slow but stable construction outlook. Having said that, we're still seeing mortgage rates at 20-year highs and uncertainty remains about future rate hikes, which dampens the housing market and impacts the near term in our Retail segment. Overall, we remain focused on economic and industry activity worldwide so that we can continue to deliver with our customers and clients value most.

此外，美國建築師協會的計費指數（ABI）在過去 6 個月中一直持平，顯示建築前景緩慢但穩定。話雖如此，我們仍然看到抵押貸款利率處於 20 年來的高位，並且未來升息的不確定性仍然存在，這抑制了房地產市場，並影響了我們零售部門的近期表現。總體而言，我們仍然專注於全球經濟和行業活動，以便我們能夠繼續為我們的客戶和客戶提供最大的價值。

Our research and insights team is best-in-class, bringing the latest data and learning to our customers. This fall, we'll be sharing our latest point of view on the workplace and designing ideal spaces based on quality and actionable data. This fresh, thoughtful perspective emphasizes what we believe are the key factors to designing the best basis to support thriving and engaged teams.

我們的研究和洞察團隊是一流的，為我們的客戶帶來最新的數據和學習。今年秋天，我們將分享我們對工作場所的最新觀點，並根據品質和可操作的數據設計理想的空間。這種新穎、深思熟慮的觀點強調了我們認為設計最佳基礎以支持蓬勃發展和敬業的團隊的關鍵因素。

Internationally, we're seeing some pockets of softness, mainly centered in Europe and China.

在國際上，我們看到了一些疲軟的地方，主要集中在歐洲和中國。

Similar to North America and the rest of world were further pursuing resilient sectors and global accounts. We've seen that our scalability and ability to deliver a wider range of products is a unique market advantage, and we'll continue to seek out these wins. In addition, over the next 12 months, we plan to transition 60 more international Herman Miller dealers into MillerKnoll dealers, expanding our offering to clients and our share of wallet with our dealers.

與北美類似，世界其他地區也在進一步追求有彈性的產業和全球帳戶。我們已經看到，我們的可擴展性和提供更廣泛產品的能力是獨特的市場優勢，我們將繼續尋求這些勝利。此外，在未來 12 個月內，我們計劃將 60 多個國際 Herman Miller 經銷商轉變為 MillerKnoll 經銷商，從而擴大我們向客戶提供的產品以及我們與經銷商的錢包份額。

Regarding Retail, the deceleration in the North American housing market and the upswing in interest rates across Europe have continued to influence demand in this segment when compared to the previous year. Nevertheless during the quarter, the order trajectory in the North American market surpassed that of other regions, primarily attributed to enhancements in our direct-to-consumer channel. We're strategically allocating resources to improve our digital platforms and technological infrastructure, aiming to enhance the overall customer experience and satisfaction levels, all while intensifying our efforts to fortify brand awareness.

在零售方面，與去年相比，北美房地產市場的減速和歐洲利率的上升繼續影響著該領域的需求。儘管如此，本季北美市場的訂單軌跡超過了其他地區，這主要歸功於我們直接面向消費者管道的增強。我們正在策略性地分配資源來改善我們的數位平台和技術基礎設施，旨在提高整體客戶體驗和滿意度，同時加強增強品牌知名度。

Furthermore, in the first quarter, we opened a new Design Within Reach store in Ardmore, Pennsylvania, which has delivered very promising early results, including robust foot traffic and order placement. Now I'd like to talk a little bit about our gross margins. It expanded year-over-year sequentially and across all of our business segments. In the past, I've talked about focusing on what we can control, and this performance is proof of that. We're seeing efficiency improvements derived from our synergy capture.

此外，第一季度，我們在賓州阿德莫爾開設了一家新的 Design Within Reach 商店，該商店取得了非常有希望的早期成果，包括強勁的客流量和訂單下達。現在我想談談我們的毛利率。它在我們所有的業務部門中逐年擴大。過去，我說過要專注於我們可以控制的事情，這次表現就是證明。我們看到我們的協同效應帶來了效率的提升。

We have pricing power. We're laser focused on inventory management and product mix, and we continue to seek cost reductions. All of these key elements that are enabling us to improve the profitability of our core operations. I'm extremely proud of all the work our teams have done and continue to do every day to seek and seize opportunities.

我們有定價權。我們專注於庫存管理和產品組合，並繼續尋求降低成本。所有這些關鍵要素使我們能夠提高核心業務的獲利能力。我對我們的團隊為尋找和抓住機會所做的所有工作感到非常自豪，並且每天都會繼續做這些工作。

Finally, this quarter was not short on activity, so I'll walk you through a few of the highlights. We started out strong with a successful (inaudible) phase, the largest North American presentation of our MillerKnoll collective of contract products and services. Throughout the quarter, we debuted new products and textiles across our collective, including NaughtOne's Morse Table System, which was awarded Gold by Best of NeoCon. Herman Miller's first collaboration with Gabriel Tan launching The Luva Modular Sofa and Cyclade Tables as well as beautiful array of textiles from our textiles group, many with sustainable fabrics at the forefront.

最後，本季的活動並不缺乏，因此我將向您介紹一些亮點。我們一開始就取得了成功（聽不清楚），這是我們 MillerKnoll 合約產品和服務集體在北美最大的展示。整個季度，我們在整個集團中推出了新產品和紡織品，包括 NaughtOne 的莫爾斯表系統，該系統榮獲 Best of NeoCon 金獎。 Herman Miller 與 Gabriel Tan 的首次合作推出了 Luva 模組化沙發和 Cyclade 桌子，以及我們紡織品集團的一系列精美紡織品，其中許多都採用最前沿的可持續面料。

The HAY team launched a collection of lamps and other ancillary items. Holly Hunt celebrated their 40th anniversary with a collection of beautiful pieces. At Knoll, we celebrated the 75th anniversary of the iconic Womb Chair, while also introducing The Saarinen table at a modern lounge height. We relaunched Herman Miller [archival] classics, all with fresh interpretation, and we made significant progress towards our sustainability goals, bringing solar power to our U.K. operations facility.

HAY 團隊推出了一系列燈具和其他輔助產品。 Holly Hunt 推出一系列精美單品慶祝其成立 40 週年。在 Knoll，我們慶祝了標誌性 Womb Chair 的 75 週年紀念，同時也推出了具有現代休息室高度的 Saarinen 桌子。我們重新推出了赫爾曼米勒（Herman Miller）[檔案]經典，全部都進行了全新的詮釋，並且我們在可持續發展目標方面取得了重大進展，將太陽能引入了我們的英國運營設施。

All in all, I'm pleased with the strong quarter we delivered. Our team is connecting and moving the business forward in exciting creative ways and we're capturing market share and growth opportunities as they arrive. While I believe the rest of fiscal year 2024 will remain a transitional year, economic indicators trending more positively pockets of weakness remaining. I'm confident in our ability to deliver shareholder value as we are operating efficiently and making decisions to further improve our margins and profitability.

總而言之，我對我們季度的強勁表現感到滿意。我們的團隊正在以令人興奮的創意方式連接並推動業務向前發展，我們正在抓住市場份額和成長機會。雖然我相信 2024 財年剩餘時間仍將是過渡年，但經濟指標趨勢更加積極，但仍有疲軟跡象。我對我們為股東創造價值的能力充滿信心，因為我們正在高效地運作並做出進一步提高利潤和獲利能力的決策。

I'm looking forward to progressing towards our goals, positively impacting our industry and advancing our strategy to remain resilient and ready for the future. With that, I want to thank you for your continued partnership with us. I'll now turn the call over to Jeff for a deeper look at our financials.

我期待著朝著我們的目標取得進展，對我們的行業產生積極影響，並推進我們的策略，以保持彈性並為未來做好準備。在此，我要感謝您與我們的持續合作。我現在將把電話轉給傑夫，以更深入地了解我們的財務狀況。

Thank you, Andi, and good evening, everyone. As Andi just said, we are proud that our teams delivered a very strong quarter. The results reflect some of the themes that we've been communicating over the past several quarters. First, our focus on diversification, both across geographies, business sectors and customer segments; and second, our focus on margins, taking action across several fronts.

謝謝你，安迪，大家晚上好。正如安迪剛才所說，我們為我們的團隊交付了非常強勁的季度感到自豪。結果反映了我們在過去幾個季度一直在溝通的一些主題。首先，我們注重跨地域、跨業務部門和跨客戶群的多元化；其次，我們關注利潤，在多個方面採取行動。

For the first quarter, we generated adjusted earnings of $0.37 per share, which were $0.16 above the midpoint of our guidance. Overall, strong net sales and gross margin expansion across all of our business segments drove the overperformance. Net sales in the first quarter were $918 million, above the midpoint of our guidance, driven by strong performance in the Americas Contract segment.

第一季度，我們調整後每股收益為 0.37 美元，比我們指導值的中位數高出 0.16 美元。總體而言，我們所有業務部門強勁的淨銷售額和毛利率擴張推動了超額業績。在美洲合約業務強勁表現的推動下，第一季淨銷售額為 9.18 億美元，高於我們指導的中位數。

Our consolidated gross margin was 39%, which was 450 basis points higher than the same quarter a year ago and also improved on a sequential period basis. Moreover, this marks the third consecutive quarter of consolidated year-over-year adjusted gross margin expansion. As Andi mentioned, several factors contributed to this, including the realization of price increases, ongoing benefits from integration-related synergies and positive shifts in product and channel mix. Our consolidated adjusted operating margin was 6% for the period.

我們的綜合毛利率為 39%，比去年同期高 450 個基點，較上季也有所改善。此外，這標誌著連續第三個季度調整後的綜合毛利率年增。正如安迪所提到的，有幾個因素促成了這一結果，包括價格上漲的實現、整合相關協同效應的持續收益以及產品和通路組合的積極轉變。期間我們的綜合調整後營業利益率為 6%。

Turning to cash flows in the balance sheet. This quarter, we generated approximately $131 million in cash flow from operations. This represents an increase of nearly $200 million compared to the same quarter last year, mostly driven by working capital improvements. As a result of this, we were able to retire $66 million of debt and took the opportunity to repurchase approximately 1.7 million shares for a total cash outlay of $31.7 million.

轉向資產負債表中的現金流量。本季度，我們的營運現金流約為 1.31 億美元。與去年同期相比增加了近 2 億美元，主要是由於營運資本改善所致。因此，我們能夠償還 6,600 萬美元的債務，並藉此機會回購約 170 萬股股票，總現金支出為 3,170 萬美元。

We finished the first quarter with a net debt-to-EBITDA ratio of 2.5x, which puts us comfortably under the maximum limit defined in our lender agreements. New orders at the consolidated level totaled $914 million in the first quarter, reflecting an organic decrease of 1.3% from the same quarter last year. While this is lower from last year on an absolute basis, the rate of year-over-year decrease once again improved this quarter.

第一季結束時，我們的淨負債與 EBITDA 比率為 2.5 倍，這使我們輕鬆低於貸方協議中定義的最高限額。第一季綜合新訂單總額為 9.14 億美元，較去年同期有機下降 1.3%。雖然絕對值低於去年，但本季年減率再次有所改善。

Within our Americas Contract segment, net sales in the period were $490 million, representing an organic decrease of 1.7% from the same quarter last year. New orders in the period totaled $487 million, which was up 2.1% over last year. This is particularly encouraging as it's the first time in 4 quarters we've reported an increase in order levels in the Americas segment. I'd also like to highlight the fact that our Americas Contract team delivered another quarter of double-digit adjusted operating margin, which totaled 10.6% in the quarter.

在我們的美洲合約部門，該期間的淨銷售額為 4.9 億美元，較去年同期有機下降 1.7%。期內新訂單總額達4.87億美元，較去年增加2.1%。這是特別令人鼓舞的，因為這是我們四個季度以來首次報告美洲市場的訂單水準有所增加。我還想強調的是，我們的美洲合約團隊又實現了四分之一的調整後營運利潤率，本季總計 10.6%。

Turning to our International Contract and Specialty segment. Net sales for the quarter totaled $228 million, down 10.9% organically year-over-year, while new orders came in at $228 million, reflecting a year-over-year organic decrease of 3.6%. While we continue to be very optimistic about the medium- to long-term growth potential in this segment, near-term macroeconomic headwinds, particularly in China and parts of Europe, are impacting demand. Adjusted operating margin within this segment was 6.5% in the first quarter, down year-over-year, driven by lower sales volume. This was partially offset by improved gross margin performance, which continues to benefit from previous price increases and our cost synergy program.

轉向我們的國際合約和專業部門。該季度淨銷售額總計 2.28 億美元，年比有機下降 10.9%，新訂單額為 2.28 億美元，年比有機下降 3.6%。雖然我們仍然對該領域的中長期成長潛力非常樂觀，但近期宏觀經濟逆風，特別是中國和歐洲部分地區的逆風，正在影響需求。由於銷量下降，該部門第一季調整後營業利潤率為 6.5%，年減。這部分被毛利率表現的改善所抵消，毛利率表現繼續受益於先前的價格上漲和我們的成本協同計劃。

Moving to our Global Retail segment. Net sales in the first quarter of $199 million, were down 13.6% organically from the same quarter last year. New orders in this segment of $199 million, were 6.4% lower than a year ago on an organic basis. While the slowdown in the North American housing market and the rise in interest rates globally continued to affect the demand for this segment compared to last year.

轉向我們的全球零售部門。第一季淨銷售額為 1.99 億美元，較去年同期有機下降 13.6%。該領域的新訂單為 1.99 億美元，有機比去年同期下降 6.4%。與去年相比，北美房地產市場放緩和全球利率上升繼續影響該細分市場的需求。

We are optimistic about the progress our team is making in expanding our market share through our direct-to-consumer channels, given the relative order performance of some of our competitors. And as such, we are further positioning our most mature retail brands as preferred choices for authentic design. Adjusted operating margin in the Retail segment was 1.6%, down year-over-year, mainly due to a combination of lower volume and product mix.

考慮到我們一些競爭對手的相對訂單表現，我們對我們的團隊透過直接面向消費者的管道擴大市場份額所取得的進展感到樂觀。因此，我們進一步將我們最成熟的零售品牌定位為正宗設計的首選。零售業務調整後營業利潤率為 1.6%，年減，主要是因為銷售量和產品組合下降。

Now turning to our near-term guidance and outlook. Given the improvements we are seeing in gross margins across each of our business segments and continued signs of demand stabilization in our North American Contract business, we are increasing our adjusted earnings guidance for the full fiscal year, which we now expect to range between $1.85 and $2.15 per share. As it relates to the second quarter of fiscal 2024, we expect net sales to range between $950 million and $990 million and adjusted diluted earnings to be between $0.52 and $0.58 per share.

現在轉向我們的近期指導和展望。鑑於我們看到每個業務部門的毛利率都有所改善，並且北美合約業務的需求持續穩定，我們正在提高整個財年的調整後盈利指導，我們目前預計該指導範圍在1.85 美元至1.85 美元之間。每股 2.15 美元。由於涉及 2024 財年第二季度，我們預計淨銷售額將在 9.5 億美元至 9.9 億美元之間，調整後攤薄收益將在每股 0.52 美元至 0.58 美元之間。

And I'd point out that this guidance takes into consideration the relative seasonal increase in sales that we expect to experience in our Retail segment from the first quarter to the second quarter of our fiscal year. So with that overview of the numbers, I'll now turn the call back over to the operator, and we'll take your questions.

我想指出的是，該指導考慮了我們預計從本財年第一季到第二季零售部門將經歷的銷售相對季節性成長。概述了這些數字後，我現在將把電話轉回給接線員，我們將回答您的問題。

(Operator Instructions) Your first question comes from the line of Budd Bugatch with Water Tower Research.

（操作員說明）您的第一個問題來自 Water Tower Research 的 Budd Bugatch。

Congratulations on the margin performance in the quarter. I would love to start just by punching into the order flow during the quarter, if you can make some commentary of how that went particularly in Americas Contract? I think if I caught your drift, you're saying we're seeing some improvement in that. And did that show up late in the quarter? And how has the second quarter started?

恭喜本季的利潤表現。我很想從本季度的訂單流開始，您能否對美洲合約的情況進行一些評論？我想如果我明白了你的意思，你是說我們在這方面看到了一些改進。這在本季末出現了嗎？第二季是如何開始的？

Yes, Budd, this is Jeff. I'll start and then John and Andi, if anyone please add as you see fit. So maybe just on the Americas segment in particular, so order activity in the first half of the quarter was positive, Budd, and showed some signs of slowing in August and the first couple of weeks of September. Now with that being said, the timing of last year's price increase, which, as a reminder, was 8% at the start of October a year ago would certainly be expected to make September's comparisons much more difficult in the current year.

是的，巴德，這是傑夫。我先開始，然後是約翰和安迪，如果有人請添加您認為合適的內容。因此，也許特別是在美洲市場，巴德，本季前半段的訂單活動是積極的，並且在 8 月和 9 月的前幾週顯示出一些放緩的跡象。話雖如此，去年的價格上漲時間（提醒一下，一年前 10 月初上漲了 8%）肯定會使今年 9 月的比較變得更加困難。

But when we zoom out from that week-to-week data, the general trends over the past 3 quarters have shown improved demand activity, and that gives us some confidence that more consistent growth is around the corner. So it was a bit choppy in August and early September. I think we're seeing some of that bump up against the tough comps from last year due to the sizable price increase we put in place at the beginning of October, but I'll pause there. And John, anything you have?

但當我們縮小每週數據時，過去三個季度的整體趨勢顯示需求活動有所改善，這讓我們有信心更一致的成長即將到來。所以八月和九月初有點波濤洶湧。我認為，由於我們在 10 月初實施了大幅提價，我們看到其中一些與去年的艱難比較相比有所提高，但我會在此暫停。約翰，你有什麼東西嗎？

Thanks, Jeff. I'd just add, if we looked at additions to the funnel for the quarter, we had, I think, the second largest volume of additions to the funnel that we've had in the last 12 quarters. So from a project activity perspective, we're still seeing a fair amount of activity. And we've seen the day-to-day business maintain a steady pace as well. So I think to your point, Jeff, a lot of opportunity. I think we're seeing some regional differences, right, in terms of strength of markets, but overall, very positive.

謝謝，傑夫。我想補充一點，如果我們查看本季漏斗的新增量，我認為我們的漏斗新增量是過去 12 個季度中第二大的。因此，從專案活動的角度來看，我們仍然看到相當多的活動。我們看到日常業務也保持穩定的節奏。所以我認為傑夫，就你的觀點而言，有很多機會。我認為，就市場實力而言，我們看到了一些地區差異，但總體而言，非常積極。

That's interesting because we had heard and I'm sure you're aware that maybe project activity had lessened in the quarter and day-to-day business had replaced that. Is that not what you're seeing? Is that varying with what you're seeing?

這很有趣，因為我們聽說過，而且我相信您也知道，本季的專案活動可能有所減少，取而代之的是日常業務。這不是你所看到的嗎？這與您所看到的有所不同嗎？

We're seeing the day-to-day activity maintain a steady solid pace. And in terms of new project adds to the funnel, it's been very robust for the last 90 days.

我們看到日常活動保持穩定的節奏。就添加到漏斗中的新項目而言，過去 90 天的表現非常強勁。

Got you. Okay. And in Retail, what are you seeing? Debbie, are you seeing any indication that maybe we're at the bottom and not getting any much worse or bouncing along the bottom?

明白你了。好的。在零售業，您看到了什麼？黛比，你是否看到任何跡象表明我們可能正處於谷底並且不會變得更糟或沿著谷底反彈？

So Budd, just from an order pacing perspective throughout the quarter would we actually saw a very strong August. We attribute softness that we saw in June and July, obviously, to the macroeconomic conditions, but also the heightened travel spend during the summer months. And on an adjusted basis, our August order performance was actually flat until last year.

因此，巴德，僅從整個季度的訂單節奏角度來看，我們實際上會看到非常強勁的八月。顯然，我們將六月和七月的疲軟歸因於宏觀經濟狀況，但也歸因於夏季旅行支出的增加。經過調整後，我們 8 月的訂單表現實際上與去年持平。

So we feel like we have momentum. Additionally, we believe, as we look at benchmarks externally, we're taking share, given the increased performance of our marketing tactics and all the other investments that we're making to improve our efficiencies and how we engage with the customer.

所以我們覺得我們有動力。此外，我們相信，當我們審視外部基準時，鑑於我們的行銷策略以及我們為提高效率以及與客戶互動的方式而進行的所有其他投資的績效不斷提高，我們正在佔據份額。

I think one of the really important points -- Budd, it's Andi, about the Retail business is also the relative strength that we're seeing in the North America Retail segment where we are seeing momentum and demand pick up compared to the past few quarters and that's encouraging since it's one of our largest segments.

我認為關於零售業務的真正重要的一點之一- 巴德，我是安迪，也是我們在北美零售領域看到的相對實力，與過去幾個季度相比，我們看到增長勢頭和需求有所回升這是令人鼓舞的，因為它是我們最大的細分市場之一。

And the segment that we have a direct-to-consumer more mature strategy, our business internationally is largely wholesale where we have limitations with open-to-buy of the wholesale partners that we sell into.

我們擁有更成熟的直接面向消費者策略的細分市場，我們的國際業務主要是批發，我們對我們銷售的批發合作夥伴的開放購買有限制。

So you're seeing better DTC than you're seeing in-store, is that what I understand?

所以你看到的 DTC 比你在店裡看到的要好，這是我的理解嗎？

We think about our direct-to-consumer business as both our store business and our e-commerce business. We also have a wholesale business, which is the sell-in of our products into third-party retail partners. Our direct-to-consumer business is performing much more resiliently right now, given the more agility we have and the levers we can deploy in that piece of our business versus in our wholesale business.

我們將直接面向消費者的業務視為商店業務和電子商務業務。我們還有批發業務，即將我們的產品銷售給第三方零售合作夥伴。與批發業務相比，我們的直接面向消費者業務現在表現得更有彈性，因為我們擁有更多的敏捷性以及我們可以在該業務中部署的槓桿。

And I think we said this, and that was my understanding that your wholesale business is primarily offshore, not domestic.

我想我們已經說過了，我的理解是，你們的批發業務主要是在海外，而不是在國內。

Primarily international.

主要是國際化。

Yes. That's correct, Budd.

是的。沒錯，巴德。

Okay. A couple of other things. You've raised the earnings guidance for the year. And I think when you were giving that guidance at the end of the fiscal year, you also mentioned a sales expectation modestly below the -- that you've just reported. Any update on that sales expectation for the full year, Jeff?

好的。還有其他一些事情。您上調了今年的獲利指引。我認為，當您在本財年末給出這項指導時，您也提到了略低於您剛剛報告的銷售預期。傑夫，全年銷售預期有什麼更新嗎？

Yes. Well, I think, we're largely in the same place. I mean we're several quarters out to end of fiscal. I think what we wanted to make sure we signaled here is that the overperformance that we delivered in Q1, we believe we can take that to the bottom line to full year. I don't think there's a meaningful change in the outlook from a revenue perspective. But we were intentionally vague, as you remember, at the end of the year when we talked about the revenue guide. So I think we're basically in the same place.

是的。嗯，我想，我們基本上處於同一個地方。我的意思是，距離財報結束還有幾個季度。我認為我們想要確保我們在這裡發出的信號是我們在第一季交付的超額業績，我們相信我們可以將其帶到全年的底線。我認為從收入角度來看，前景不會發生有意義的變化。但正如你所記得的，我們在年底談論收入指南時故意含糊其辭。所以我認為我們基本上處於同一位置。

I do. I do remember. And last...

我願意。我確實記得。最後...

Of course, you feel bad.

當然，你感覺不好。

Sorry, that's just -- it's a fault that I just -- I'm trying to overcome. Last for me is the restructuring. Can you give us a little bit of color on what that is and where it is in the process? Do you still see more restructuring charges in the upcoming quarters? And is it primarily on the salary, the compensation side?

抱歉，那隻是——這是我的一個錯誤——我正在努力克服。最後對我來說是重組。你能給我們一些關於它是什麼以及它在這個過程中的位置的資訊嗎？您在接下來的幾個季度中還會看到更多的重組費用嗎？主要是在工資、補償方面嗎？

Yes. So Budd, maybe a point of clarity. So we have total charges in the quarter that I'll call for purposes of the discussion, special charges that totaled about $15 million. A subset of those costs were true restructuring-related expenses that tied to workforce reduction actions that are both here in the U.S. and some international that have already been announced and implemented.

是的。巴德，也許需要澄清一點。因此，我們在本季度的總費用（出於討論目的，我將稱之為特殊費用）總計約為 1500 萬美元。這些成本的一部分是真正與重組相關的費用，這些費用與美國和一些國際上已經宣布和實施的裁員行動有關。

I can't say that we have other imminent plans for further restructuring. Obviously, we will react to business conditions like we always do. The remainder of the cost, so the restructuring component of that was about $5 million. The balance that you see there in the total charges for the quarter continue to relate to cost to achieve and integration-related costs related to our synergy capture program.

我不能說我們還有其他近期的進一步重組計劃。顯然，我們會像往常一樣對業務狀況做出反應。其餘成本，即重組部分約 500 萬美元。您在本季度總費用中看到的餘額繼續與實現成本以及與我們的協同捕獲計劃相關的整合相關成本相關。

And those costs, Budd, are just ongoing in-flight integration projects. We're nearing the end of the process, as we -- our full target is a 3-year goal, and that would essentially be at the end of Q1 of next fiscal year would be that 3-year mark. And we're at a point now where most of the remaining in-flight projects are either consolidation related to showroom or some manufacturing-related moves that are planned.

巴德，這些成本只是正在進行的整合項目。我們的進程已接近尾聲，因為我們的全部目標是 3 年目標，而這基本上是在下一個財年第一季末實現的 3 年目標。我們現在所處的階段是，大多數剩餘的正在進行的項目要么是與陳列室相關的整合，要么是計劃中的一些與製造相關的舉措。

So you've got a combination of operating expenses from showroom moves that should be further synergies as well as cost of goods sold impact related to some of the factory work that we've got in place. So you'll see some more of that over the balance of this fiscal year as we complete those projects.

因此，您可以獲得陳列室搬遷帶來的營運費用的組合，這應該是進一步的協同效應，以及與我們已經到位的一些工廠工作相關的銷售商品成本的影響。因此，當我們完成這些專案時，您會在本財年的剩餘時間內看到更多這樣的情況。

So we'll continue to see the integration side. We know the amortization of PI. That's going to continue. The restructuring, you will do that as you find projects and things that you're going to -- that may affect. And I understand this is quite sensitive compensation and workforce. But those are not yet announced. Is that the way to understand it?

所以我們將繼續關注整合方面。我們知道PI的攤銷。這種情況將會持續下去。重組時，你會在發現可能會影響的項目和事情時進行重組。我知道這是相當敏感的薪資和勞動力。但這些尚未公佈。是這樣理解的嗎？

That is correct. Nor do we have necessarily plans to announce them so. Again, we'll react to business conditions as we move through the balance of the year.

那是對的。我們也不一定有計劃如此宣布它們。同樣，我們將在今年餘下的時間裡對業務狀況做出反應。

Your next question comes from the line of Greg Burns with Sidoti.

你的下一個問題來自 Greg Burns 和 Sidoti 的對話。

In North America now that we're nearing the end of the integration process, how has the consolidation of the dealer networks gone? Are we at the point now where they're fully up to speed and generating the level of productivity that you would expect them to? Or is there still a level of learning curve that they need to move up to sell the full portfolio of products?

在北美，我們的整合流程已接近尾聲，經銷商網路的整合進展如何？我們現在是否已經達到了他們完全跟上速度並產生您期望的生產力水平的程度？或者他們還需要提升一定的學習曲線才能銷售完整的產品組合？

Yes. I mean I would say, overall, Greg, we're very pleased in North America with the pace at which our dealers and our dealer designers have learned all the product lines from the corresponding legacy companies. But I'll let John add some color to that.

是的。我的意思是，總的來說，格雷格，我們對北美的經銷商和經銷商設計師從相應的傳統公司學習所有產品線的速度感到非常滿意。但我會讓約翰為此添加一些色彩。

Yes, I think we are really, really pleased with the way the network has come together. We had just last week 22 of our largest dealers in West Michigan, 11 originally from the Miller side, 11 from the Knoll side. Honestly, you couldn't tell who came from which camp, right? They really have meshed extremely well together.

是的，我認為我們對網路的整合方式非常非常滿意。就在上週，我們在西密西根州擁有 22 家最大的經銷商，其中 11 家最初來自米勒一側，11 家來自諾爾一側。老實說，你分不清誰來自哪個陣營，對吧？他們確實配合得非常好。

Obviously, there's a learning curve to learn the new products. And I would say if I characterize our FY '23 that learning curve, we probably started up it a bit more slowly than we expected, but we finished much stronger than we expected. We really picked up a lot of momentum throughout the course of the year. And I think we exceeded our expectations in terms of what we would call cross-sell legacy Miller dealers selling no products and vice versa. So that's -- we're really pleased with the way the networks come together.

顯然，學習新產品有一個學習曲線。我想說，如果我描述我們 23 財年的學習曲線，我們的啟動速度可能比我們預期的要慢一些，但我們的完成速度比我們預期的要強得多。我們在這一年確實獲得了極大的動力。我認為我們在所謂的交叉銷售傳統米勒經銷商不銷售產品方面超出了我們的預期，反之亦然。所以，我們對網路的整合方式非常滿意。

Okay. Great. And then I understand the kind of the macro issues impacting some of the international markets. Can you just talk about what the opportunity is there to sell that -- the broader portfolio? I know you're adding dealers, but how far along are you in addressing that opportunity longer term? Are we still in the very early innings? Are we not really seeing much of that yet? And is there potential for you to offset maybe some of the macro challenges that you're seeing here with some of these organic growth initiatives?

好的。偉大的。然後我了解了影響某些國際市場的宏觀問題。您能否談談出售更廣泛的投資組合的機會是什麼？我知道您正在增加經銷商，但從長遠來看，您在抓住這個機會方面進展到了什麼程度？我們還處於早期階段嗎？我們還沒有真正看到很多這樣的情況嗎？您是否有可能透過這些有機成長舉措來抵消您在這裡看到的一些宏觀挑戰？

Yes, Greg, you took the words right of my mouth. I would say that we focused our attention on North America to begin this process so that we could learn it's also our largest business. And we're now focusing on International. So we are just beginning this process. We've converted dealers but as far as rationalizing product, learning product specs, continuing to convert dealers. We see a lot of runway and opportunity, particularly in selling the Knoll -- [Studio Knoll] ancillary products throughout the world. So we have a long way to go there, and we're actually pretty excited about what it can offset. So we're at the beginning of the process internationally.

是的，格雷格，你聽懂我的話了。我想說的是，我們將注意力集中在北美來開始這個過程，這樣我們就可以知道這也是我們最大的業務。我們現在專注於國際。所以我們才剛開始這個過程。我們已經轉變了經銷商，但就產品合理化、了解產品規格而言，我們繼續轉變經銷商。我們看到了很多跑道和機會，特別是在全世界銷售 Knoll——[Studio Knoll] 輔助產品。因此，我們還有很長的路要走，而且我們實際上對它可以抵消的影響感到非常興奮。因此，我們正處於國際進程的開始階段。

Okay. Great. And then -- go ahead.

好的。偉大的。然後——繼續吧。

Knoll had very limited contract dealers in the past. They really focused primarily on the interior design and retail wholesale customers. So opening up that product line to contract dealers is a new effort, and we're excited about that. Anything you would add, Jeff?

諾爾過去的合約經銷商非常有限。他們主要關注室內設計和零售批發客戶。因此，向合約經銷商開放該產品線是一項新的努力，我們對此感到興奮。傑夫，你還有什麼要補充的嗎？

Yes. I think, Greg, we may have mentioned this at end of year, but just recall that we've got -- I mean, this kind of builds on your comment about the dealer network that Knoll really didn't have an extensive international dealer network. And we're phasing into that -- to that MillerKnoll dealer format. And we've got about 80 of those dealers -- of 335 international Herman Miller dealers 80 of them are transitioned at this point and we expect another 60 yet this year. So we're moving forward with that in a pretty disciplined clip, I would say.

是的。我想，格雷格，我們可能在年底提到過這一點，但請記住，我們已經- 我的意思是，這種建立在您對經銷商網絡的評論之上，即諾爾確實沒有廣泛的國際經銷商網路。我們正在逐步採用 MillerKnoll 經銷商模式。我們已經有大約 80 家經銷商——335 家國際 Herman Miller 經銷商中，其中 80 家目前已經轉型，我們預計今年還會有 60 家經銷商。所以我想說，我們正在一個非常有紀律的剪輯中推進這一點。

All right. Great. And then lastly, I appreciate the kind of balanced approach you're taking to capital allocation. Relative to your leverage, is there a target you're trying to get to? Are you comfortable at 2.5x? Are you trying to reduce that any further going forward?

好的。偉大的。最後，我很欣賞你們在資本配置上所採取的平衡方法。相對於你的槓桿，你是否有一個想要達成的目標？ 2.5倍你覺得舒服嗎？您是否想進一步減少這種情況？

Yes, Greg, Jeff. We're certainly comfortable with the 2.5 where we are now. We have said from the beginning, we intend to kind of follow a migration path or a glide path that would see that debt level come down over time. Nothing has changed on that front from our perspective. I think longer term, somewhere around 2x of leverage would seem reasonable.

是的，格雷格，傑夫。我們對目前的 2.5 版本當然感到滿意。我們從一開始就說過，我們打算遵循遷移路徑或下滑路徑，使債務水準隨著時間的推移而下降。從我們的角度來看，這方面沒有任何改變。我認為從長遠來看，大約 2 倍的槓桿似乎是合理的。

But some -- that also is highly influenced by the level of demand and earnings power that we see in the business. So I would just simply say we intend to continue to pay debt down as we move forward, but we're in no way fussed with the leverage ratio that we have today.

但有些——這也很大程度上受到我們在業務中看到的需求水平和盈利能力的影響。因此，我只想簡單地說，我們打算在前進的過程中繼續償還債務，但我們絕對不會擔心我們今天的槓桿率。

Your next question comes from the line of Reuben Garner with Benchmark.

您的下一個問題來自 Reuben Garner 與 Benchmark 的對話。

So, Andi, you mentioned an inflection point. I was curious if you could elaborate on that. Is that an inflection in MillerKnoll specifically? Is it -- was that a profitability comment? Was that a macro perspective? Anything that you can kind of give on that comment would be helpful.

安迪，你提到了一個轉捩點。我很好奇你能否詳細說明一下。這是 MillerKnoll 的特殊變形嗎？這是關於盈利能力的評論嗎？這是宏觀視角嗎？您可以針對該評論提供的任何內容都會有所幫助。

Yes. It's really a macro perspective and also the sentiment that we're hearing from our customers, from CEOs and from research that we've done around returning to office, around spending time together. I think that we are seeing a lot more of our clients finding ways to bring people back together, finding ways to utilize their space. I think the world has moved through a cycle of remote to hybrid to flexibility.

是的。這確實是一個宏觀視角，也是我們從客戶、執行長以及我們圍繞重返辦公室、共度時光所做的研究中聽到的情緒。我認為我們看到越來越多的客戶在尋找讓人們重新聚集在一起的方法，尋找利用他們的空間的方法。我認為世界已經經歷了從遠端到混合再到靈活性的循環。

And I think as John talked about new projects and new demand in the funnel that return and I think CEO sentiment around the return has turned to the majority in favor of being together more often, and that works well for us, and we're excited about that. That's what I meant.

我認為，當約翰談到回歸漏斗中的新項目和新需求時，我認為首席執行官對回歸的情緒已經轉向大多數人，贊成更頻繁地在一起，這對我們來說很有效，我們很興奮關於那個。我正是這個意思。

And so that project funnel that John referenced, what about the willingness and maybe this goes into your inflection point comment? Are you seeing a change in the willingness to kind of pull the trigger on those projects? Or is it still kind of that planning and thinking about the new way of work phase?

那麼約翰提到的項目漏斗，意願怎麼樣，也許這會進入你的拐點評論？您是否發現啟動這些專案的意願發生了變化？還是仍是對新的工作方式進行規劃和思考的階段？

Yes. We're seeing more confidence in decision-making. The less CEOs and decision-makers waiting to see what everyone else is doing and sort of boldly going into what's right for their organization, obviously, with some help and guidance from us. And the decision points, I don't think there is short and John, please add to this, as short as they used to be pre-COVID, but they've certainly shortened substantially from where they were 6 months to a year ago. Would you add, John?

是的。我們看到人們對決策更有信心。顯然，在我們的幫助和指導下，執行長和決策者越來越少地等著看其他人在做什麼，並大膽地研究適合他們組織的事情。我認為決策點並不短，約翰，請補充一下，就像新冠疫情爆發前的情況一樣短，但與 6 個月到一年前相比，它們確實已經大大縮短了。約翰，你能補充一下嗎？

I would agree, Andi, in that the -- there is still a lot of iterating that goes on before the plan is finally complete. So people are -- really want to make sure that they get it right. But I would add to that, there is a growing sense of urgency among CEOs and leaders maybe even a sense of frustration on this topic, which to Andi's point, is sort of a catalyst for activity and to kind of get off the fence on some of these projects and make decisions. So obviously, that's positive for us and for our industry.

安迪，我同意，在計劃最終完成之前，仍然需要進行大量迭代。所以人們真的想確保他們做對了。但我想補充一點，執行長和領導者之間的緊迫感日益增強，甚至可能對這個主題感到沮喪，對安迪來說，這是某種活動的催化劑，可以在某些方面擺脫困境。並做出決策。顯然，這對我們和我們的行業來說都是積極的。

Great. And Jeff, sorry if I missed this, but can we give an update on where we are in the price/cost. Jeremy, I know you guys had an increase out as recently as this summer, I believe. Are the current kind of double-digit margin run rates that you're seeing in the Americas fully reflecting your price cost? Have you gotten your margin back or is there still kind of room to run there?

偉大的。傑夫，抱歉，如果我錯過了這一點，但我們能否提供有關價格/成本的最新資訊。傑里米，我相信你們最近在今年夏天的表現有所增加。您在美洲看到的當前兩位數的利潤運行率是否完全反映了您的價格成本？你的利潤已經收回了嗎？還是還有空間可以運行？

Yes, Reuben, I would say it this way. So yes, you are correct. First of all, I'll confirm we did have an increase that was effective. John, keep me honest here, was July or beginning of July. So we -- and it was a certainly not the 8% and 10% that we had been seeing in years. Recent years past, it was closer to 3% on average. So more akin to typical history of price increases. And that will take some time to layer in. And so we think there's some further upside there.

是的，魯本，我會這麼說。所以是的，你是對的。首先，我將確認我們確實進行了有效的成長。約翰，老實說，那是七月或七月初。所以我們——這肯定不是我們多年來看到的 8% 和 10%。近年來，平均這一比例接近 3%。因此更類似於典型的價格上漲歷史。這需要一些時間才能體現出來。因此我們認為還有一些進一步的好處。

I want to maybe take this as an opportunity to highlight the fact that the synergy plan that we have been spending so much time and effort on over the past 2-plus years. We have been working hard in the background and market conditions have been such that it's largely masked all -- so much of that work. And I think what you're seeing now and you see in the Americas business, we were 800-plus basis points of gross margin expansion year-on-year this quarter. That's a big deal.

我想也許藉此機會強調一個事實，即我們在過去兩年多的時間里花費了大量的時間和精力來製定協同計劃。我們一直在幕後努力工作，而市場狀況在很大程度上掩蓋了所有工作——這麼多工作。我認為您現在看到的以及美洲業務中看到的情況是，本季度我們的毛利率同比增長了 800 多個基點。這是一件大事。

And I attribute that it's pricing -- it's price cost factors, as you highlight, for sure. Those have come back in our favor a bit, and we still have a little room to run there, I believe. But the synergy plan is layering in and you heard my comments a few minutes ago on the remaining projects. We think there's still some room for further margin expansion there.

我將其歸因於定價——正如您所強調的，這當然是價格成本因素。這些已經對我們有利一些，我相信我們還有一點空間。但協同計畫正在逐步落實，幾分鐘前您聽到了我對其餘項目的評論。我們認為那裡的利潤率仍有進一步擴大的空間。

Now the precondition for that has always been in this business, you have to have some level of demand support. And so that's why we will continue to watch the macro picture very closely, as you can imagine. But if we get some support there, we think the table is set for even some further margin expansion as we move forward.

現在這個行業的前提一直是，你必須有一定程度的需求支援。因此，正如您可以想像的那樣，這就是為什麼我們將繼續密切關注宏觀形勢。但如果我們在那裡得到一些支持，我們認為隨著我們的前進，利潤率將進一步擴大。

You stole my thunder. That was my follow-up question. So I think I'll end with stock repurchase. I believe that was the largest repurchase we've seen in some time for the quarter. Maybe just update us on what you're thinking is there? Is that something we'll continue to see if the stock kind of remains at these levels? It seems to speak to your confidence that maybe we're turning the corner here and that's not reflective of that, but I don't want to put words in your mouth?

你搶了我的風頭這是我的後續問題。所以我想我會以股票回購結束。我相信這是本季一段時間內我們看到的最大規模的回購。也許只是告訴我們您的想法？如果庫存保持在這些水平，我們會繼續看到這種情況嗎？這似乎顯示了你的信心，也許我們正在扭轉局面，但這並不反映這一點，但我不想把話放在你嘴裡？

Yes, I would say we believe we're oversold, but I think we have a very balanced perspective on capital allocation. We'll continue to pay down debt. But if we continue to see opportunistic time to purchase our stock, we'll do that too. We believe that's a great return for our shareholders, and we believe in the future.

是的，我想說我們相信我們已經超賣了，但我認為我們對資本配置有非常平衡的看法。我們將繼續償還債務。但如果我們繼續看到買進股票的機會主義時機，我們也會這樣做。我們相信這對我們的股東來說是一個巨大的回報，我們對未來充滿信心。

Congrats on the strong results and good luck.

恭喜您取得優異的成績並祝您好運。

Thank you, Reuben.

謝謝你，魯本。

Your next question comes from the line of Alex Fuhrman with Craig-Hallum.

你的下一個問題來自 Alex Fuhrman 和 Craig-Hallum 的對話。

Most of my questions were asked here earlier, but I guess just to -- take a look at the full year guidance, I mean, definitely much better-than-expected results in Q1 and guided to -- for Q2 on the bottom line. Certainly don't mean this to sound nitpicky or anything, but it looks like the degree to which you beat Q1 estimates and Q2 wasn't maybe fully flowed through to the full year.

我的大部分問題都是早些時候在這裡提出的，但我想只是看看全年指導，我的意思是，第一季度的結果肯定比預期好得多，並指導第二季度的底線。當然，這並不是說這聽起來很挑剔或其他什麼，但看起來你超出第一季預期的程度，而第二季可能沒有完全流到全年。

Is that just being a little bit conservative? Or you may be expecting that some of the headwinds you mentioned on a macro basis related to things like housing in China and Europe, is that expected to offset some of the gains that you've seen with gross margin and your North America business maybe in the back half of the year?

這只是有點保守嗎？或者您可能會預期，您提到的與中國和歐洲的房地產等宏觀基礎上的一些不利因素預計會抵消您在毛利率和北美業務方面看到的一些收益。下半年？

Yes. As I said earlier on, Alex, I think we're super enthusiastic, but we are also pragmatic and vigilant. I think we live in a very dynamic world right now. And while we have enthusiasm and optimism, we do have China that hasn't come back as quickly as we like. We have European consumer who has mortgages where interest rates are not fixed who's not necessarily back in the wholesale market.

是的。正如我之前所說，亞歷克斯，我認為我們非常熱情，但我們也很務實和警惕。我認為我們現在生活在一個非常充滿活力的世界。儘管我們充滿熱情和樂觀，但中國確實沒有像我們希望的那樣迅速復甦。我們有歐洲消費者，他們有抵押貸款，但利率不固定，他們不一定會回到批發市場。

So we're watching these things very closely. And while we feel very strongly about our diversified business model and our ability to offset these things, we want to make sure we have the right mix of enthusiasm and pragmatism.

所以我們正在非常密切地關注這些事情。雖然我們對我們的多元化業務模式和抵消這些問題的能力感到非常強烈，但我們希望確保我們擁有熱情和務實的正確組合。

There are no further questions. We turn the floor back to President and CEO, Andi Owen for any closing remarks.

沒有其他問題了。我們請總裁兼執行長安迪歐文 (Andi Owen) 發表結束語。

Thank you so much, you guys for joining us on the call. We really appreciate your continued support of MillerKnoll, and we look forward to updating you on our next quarterly call. Have a great night.

非常感謝你們加入我們的通話。我們非常感謝您對 MillerKnoll 的持續支持，我們期待在下一個季度的電話會議上向您通報最新情況。祝你有個愉快的夜晚。

This concludes today's conference call. You may disconnect.

今天的電話會議到此結束。您可以斷開連線。